Malaysia: Lotte Chemical Titan raises $878m in country’s biggest IPO since 2012

Photo: REUTERS/Kim Hong-Ji

Malaysia’s Lotte Chemical Titan Holding raised about 3.77 billion ringgit ($878 million) from an initial public offering (IPO) after pricing its shares at the bottom of an indicative range.

The IPO was, nevertheless, the biggest stock market flotation in Malaysia since 2012.

The integrated petrochemical producer, part of South Korean conglomerate Lotte Group, had initially planned to price its offer last week. However, due to a lukewarm reception from investors it instead relaunched the IPO on Monday after slashing the shares on offer by a fifth to 580 million.

It also lowered the indicative price range to 6.50-8.00 ringgit per share from 7.60-8.00 ringgit earlier. In a statement on Tuesday, Lotte Chemical Titan said the IPO had been priced at 6.50 ringgit.

The company said global institutional investors accounted for about 30 percent of total demand while 23.5 percent of the shares was taken up by five local cornferstone investors.

“The institutional ofering of the IPO received strong demand from both Malaysian and global institutional investors, and was oversubscribed,” the company said in a statement.

At 6.50 ringgit a share, Lotte Chemical Titan will have a market capitalisation of about 15 billion ringgit, it said. The shares are due to start trading on Bursa Malaysia on July 11.

Sources familiar with the matter had told Reuters that retail interest for the IPO was weak as investors had deemed the offer overvalued.

“Ninety percent of the institutional investors are long-only funds,” one source said, declining to be named as the process was private.

The offering attracted five cornerstone investors – Permodalan Nasional, Eastspring Investments, Great Eastern Life Assurance Malaysia, Maybank Asset Management and Maybank Islamic Asset Management.

Credit Suisse, JPMorgan and Maybank are joint global coordinators for the IPO. Bookrunners are CIMB, HSBC and Nomura.

Joseph Sipalan contributed to this story.

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Lotte Chemical Titan slashes Malaysian IPO size due to tepid investor response

Reuters

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.